2014 (1) TMI 1098 - AT - Service Tax

Rejection of refund claim on terminal handling charges Charges not mentioned in the Notification list - Whether or not the service tax paid on terminal handling charges is refundable under notification No. 41/2009 Held that - Even if the service provider is having only registration of one service, the exporter under notification No. 41 of 2007 is entitled to refund of the service tax paid and used for export of goods and that no verification of registration certificate of the service provider is necessary -nowhere from the records, it is coming out that service tax was paid by the service provider under business support services - Relying upon CST. Ahmedabad Vs. Riddhi Siddhi Cluco Biols Ltd. 2011 (8) TMI 187 - CESTAT, AHMEDABAD - there was no ground to reject the refund claim when appellant was claiming refund of service tax that has been paid as port services Decided in favour of Assessee.

Summary

Issues:
1. Classification of service for refund claim.
2. Interpretation of notification No. 41/2009-ST.
3. Applicability of Circular No. 112/6/2009-S.T.
4. Refund eligibility without verification of registration certificate.

Issue 1: Classification of service for refund claim

The appeal was filed against the rejection of a refund claim on terminal handling charges. The original adjudicating authority classified the service as business support service, while the appellant claimed it to be port services. The Commissioner (Appeal) held that the service tax was paid under business support services, not under Port Services, leading to the rejection of the refund claim. The matter was remanded to verify the nature of the service received by the appellant and whether the original finding was correct.

Issue 2: Interpretation of notification No. 41/2009-ST

The key point to be decided was whether the service tax paid on terminal handling charges was refundable under notification No. 41/2009-ST. The appellant claimed the refund as port services, but the Commissioner (Appeal) stated that the tax was paid under business support services, not specified under the notification. The invoices indicated various charges, including terminal handling charges, with no clear indication of the service tax head. The Circular No. 112/6/2009-S.T. clarified that exporters are entitled to refunds for taxable services used for export without verifying the service provider's registration certificate.

Issue 3: Applicability of Circular No. 112/6/2009-S.T.

The Circular clarified that exporters can claim refunds for taxable services used for export without needing to verify the service provider's registration certificate. As the records did not show the service tax was paid under business support services, the rejection of the refund claim based on this ground was unfounded. The appellant relied on previous judgments supporting the admissibility of such refunds, leading to the allowance of the appeal.

Issue 4: Refund eligibility without verification of registration certificate

The Circular emphasized that exporters can claim refunds for taxable services used for export without the need to verify the service provider's registration certificate. Since the service provider's registration of one service did not affect the appellant's eligibility for a refund, the rejection of the claim based on this ground was deemed incorrect. The appellant's claim for a refund of service tax paid as port services was upheld based on the observations and relevant legal provisions.

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